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ILG in €140m outlay for debut institutional fund

The Munich-based real estate asset manager has made its first purchases for its debut institutional property fund. The six retail assets are within close proximity of major German cities such as Frankfurt, Hamburg and Bremen. 

ILG Group, the Munich-based real estate asset manager, has made its first outlays for its first fund aimed at institutional investors with the acquisition of six German retail outlets for €140 million.

The six shopping centers were acquired on behalf of the ILG Einkaufen Deutschland I fund. They were purchased from German real estate investment manager Hanseatische Betreuungs und Beteiligungsgesellschaft (HBB).

Totaling more than 300,000 square feet, the six properties are spread across central, northern and north-western Germany, but are within close proximity of major cities such as Frankfurt, Hamburg and Bremen. ILG did not disclose the individual price of each asset.

Three of the assets, in Ingelheim, Ahlen and Walsrode, were acquired last month. While two more, in Uelzen and Nidderau, will be officially taken over by ILG in early 2017, the firm confirmed. The asset manager also said it will take full ownership of the final property in the transaction, in Plettenberg, at the end of 2017.

“We have managed to set up an extensive pipeline for further acquisitions and have already entered into concrete negotiations with a few vendors, meaning that we are counting on further acquisitions within 2016.“ Said Florian Lauerbach, managing partner of ILG.

Uwe Hauch, fellow managing partner of ILG, said: “HBB has a talent for developing structurally and contractually sophisticated retail properties in regionally relevant locations. We know that we're purchasing quality here.”

ILG, which launched the fund in April, held a first close on the open-ended vehicle at the end of August, raising €150 million in capital commitments from institutional investors, a move which marked a departure from its traditional retail structure. The firm said it had a fundraising target of €400 million and would therefore be investing another €260 million. On announcing the first close, ILG said it was hoping to make between eight and 12 transactions on behalf of the vehicle, with an approximate price range of between €30 million and €50 million per deal.